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Good practice Imported

Upper Tana-Nairobi Water Fund (Kenya)

Kenya · Nairobi · See the Kenya profile · See the Nairobi profile

Evidence: Descriptive / self-reported Top 47% 47/100 · Ask Evidence Copilot about this practice

Africa’s first water fund (2015): TNC and partners pay 50,000+ Upper Tana farmers to protect Nairobi’s water supply for 9M people. USD 18 M invested; 73,000 ha managed; 3.6 M trees planted; projected 50% sediment cut, 15% water-yield gain; USD 250,000/yr in utility savings.

18 USD million
Fund investment committed (by 2024)
25 USD million
GEF-led co-financing (by 2024)
73,000 ha
Land under improved management (by 2024)
36,000 ha
Public forest under improved management (by 2024)
50,000+ farmers
Farmers using sustainable practices (by 2024)
3.6 million trees
Trees planted (by 2024)
8,500 farmers
Smallholder coffee farmers with Rainforest Alliance certification (by 2024)
1 million trees
Fruit trees planted (by 2024)
50 USD million/year
Reported annual local income increase (self-reported) (current)
50 %
Projected sediment concentration reduction (modelled) (projected)
15 %
Projected water yield increase (modelled) (projected)
250,000 USD/year
Projected utility cost savings (modelled) (projected)
21.5 USD million
Projected 30-year benefit on a USD 10M investment (modelled) (projected, 30-year horizon)

Details

Maturity
Scaling
Promoter
Upper Tana-Nairobi Water Fund (UTNWF Trust) / The Nature Conservancy
Period
2015-present
Keywords
watershed protection, water security, smallholder agriculture, nature-based solutions, corporate PES

Context

The Upper Tana-Nairobi Water Fund (UTNWF) is Africa's first water fund, established in 2015 by The Nature Conservancy in partnership with the Nairobi City Water and Sewerage Company (NCWSC), Kenya Electricity Generating Company (KenGen), the International Centre for Tropical Agriculture (CIAT), and downstream corporates including Coca-Cola and East African Breweries. It was registered as an independent Kenyan trust in September 2021. The Upper Tana watershed supplies 95% of Nairobi's drinking water and powers KenGen's Seven Forks hydropower dams.

Objectives

To apply the avoided-cost PES principle — financing upstream watershed conservation because preventing degradation at source is cheaper than treating water downstream — by pooling contributions from downstream water users, industry and investors.

Activities

The fund supports farmers in adopting sustainable land-management practices, tree planting, and Rainforest Alliance certification for smallholder coffee growers, alongside fruit-tree planting to diversify farmer income.

Results

By 2024, the fund had committed USD 18 million (with USD 25 million in GEF-led co-financing), bringing 73,000 hectares under improved land management, including 36,000 hectares of public forests. More than 50,000 farmers now use sustainable practices, 3.6 million trees have been planted, and 8,500 smallholder coffee farmers hold Rainforest Alliance certification. Farmers planted 1 million fruit trees, which the programme reports has raised local incomes by USD 50 million annually. Hydrological modelling by the Natural Capital Project (Stanford) and FutureWater projects a 50% reduction in sediment concentration and a 15% increase in water yields, generating a projected USD 250,000/year in direct cost savings for NCWSC; a USD 10 million investment is projected to deliver USD 21.5 million in economic benefits over 30 years.

Conclusions

The UTNWF model has since been replicated in more than 35 water funds across Africa and globally, though its most-cited water-quality and cost-saving benefits remain model projections rather than measured outcomes.

Implementation
Indicative cost
High (€500k–€5M) — USD 18 million committed by fund partners plus USD 25 million in GEF-led co-financing by 2024; a further USD 10 million investment is modelled to return USD 21.5 million in economic benefits over 30 years.
Time to results
Long (> 3 years) — Established 2015; registered as an independent trust in 2021; benefits are modelled over a 30-year horizon.
Staffing & skills
The Nature Conservancy (TNC) as lead implementer, Partners: Nairobi City Water and Sewerage Company (NCWSC), Kenya Electricity Generating Company (KenGen), International Centre for Tropical Agriculture (CIAT), Downstream corporate co-funders: Coca-Cola, East African Breweries, Registered as an independent Kenyan trust since September 2021

Conditions for success

  • Avoided-cost logic aligning multiple downstream beneficiaries (utility, hydropower, industry) to co-finance upstream conservation
  • Diversified funding, including GEF-led co-financing
  • Certification schemes (Rainforest Alliance) creating direct farmer income incentives

Common failure modes

  • Key headline outcomes — sediment reduction, water-yield gain, utility cost savings and the benefit-cost projection — are hydrological model projections, not measured or independently verified field outcomes
  • The USD 50 million/year local income increase is a programme self-reported figure

Where it fits

Governance type
Independent multi-stakeholder trust (NGO-led with utility, energy-company and corporate co-funders)
Scale
Large river basin supplying a capital city
Income level
Lower-middle income (Kenya)

Commonly funded by

Philanthropic / foundation funding

Indicative funding routes for practices of this type — always check each programme's current calls and eligibility rules.

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Data sources

Where this practice's information was retrieved from, and when.

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